Interim report Q1-Q3 2013tryg.com/sites/tryg.com/files/2019-01/2013.10.10... · This report...

Interim report Q1-Q3 2013

This is a translation of the Danish interim report Q1-Q3 2013. In case of any discrepancy between the Danish and the English version of the interim report Q1-Q3 2013,

the Danish version shall apply.

Webcast and teleconference

Tryg hosts a webcast and teleconference on Thursday 10 October 2013 at 9.30 CET. View the webcast at tryg.com. Financial analysts and inves-tors may attend in person at Grange City Hotel in London or on tel. +44 (0) 844 571 8957 or +45 32 72 80 18, where questions can be asked.

The webcast and teleconference will be held in English and can subsequently be viewed at tryg.com.

This report constitutes Tryg A/S’s consolidated financial statements and has not been audited. Unless otherwise indicated, all comparisons are made to Q3 2012. Comparative figures for Q3 2012 are generally stated in brackets.

Editors Investor Relations Design e-typesLayout amo design

Contents

Interim report Q1-Q3 2013 Page

Management’s reviewHighlights 1

Income overview 2

Tryg’s results 3

Private 8

Commercial 10

Corporate 12

Sweden 14

Investment activities 16

Capital 18

Outlook 19

Disclaimer 20

Financial statementsStatement by the Supervisory Board and the Executive Management 22

Financial highlights 23

Income statement 24

Statement of comprehensive income 25

Statement of financial position 26

Equity 28

Cash flow statement 30

Notes 31

Quarterly outline 40

Further information 42

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Tryg A/S | Interim report Q1-Q3 2013 | 1

Highlights

Combined ratio target attained

The target of a combined ratio of 90 or lower from Q3 2013

has been attained at the agreed level. Moving forward,

the target remains of a return on equity after tax of 20%

to be achieved by delivering a full-year combined ratio

of 90 or lower.

Highlights for Q3 2013

• ProfitbeforetaxofDKK907m(DKK976m).

• TechnicalresultofDKK766m(DKK652m).

• Combinedratioimprovedby2.9percentagepointsto84.8(87.7).

• Owninternalefficiencyprogrammeimprovedresultsby

DKK110m.

• Declineinpremiumincomeof3.4%impactedby

profitabilitymeasuresandprofitsharing.

• Expenseratioimprovedto15.5(16.4).

• ThematchportfolioyieldedanegativeresultofDKK33m,

while the return on the free investment portfolio totalled 2.0%.

• Returnonequityof27.0%p.a.aftertax(29.4%).

Highlights for Q1-Q3 2013

• ProfitbeforetaxofDKK2,354m(DKK2,379m).

• TechnicalresultofDKK1,950m(DKK1,844m).

• Combinedratioimprovedby1.2percentagepoints

to 87.3 (88.5).

• Owninternalefficiencyprogrammeimprovedresults

byDKK270m.

• 2.9%declineinpremiumincome.

• Expenseratioimprovedto15.7(16.5).

• ReturnofDKK2monthematchportfolio,andafree

investment portfolio return of 5.3%.

• Returnonequityof22.0%p.a.aftertax(24.8%).

New initiatives during the quarter

• Updatedfinancialtargetsattained

• Efficiencyprogrammeontrack

• CombinedratioforSwedenunder90

• TrygPluscustomerprogrammeintroducedinNorway

• ParkingcoverintroducedinNorway

• ChangedofficestructureinNordicregiondecided

• NewGroupExecutiveVicePresident,Commercial

Consistent improvement in results

achieved through efficiency programme,

and cost cuts ensured attainment of the

announced target of a combined ratio of

90 or lower from Q3 2013.

2 | Interim report Q1-Q3 2013 | Tryg A/S

Income overview

Q3 Q3 Q1-Q3 Q1-Q3 FYDKKm 2012 2013 2012 2013 2012

Gross premium income 5,196 4,867 15,238 14,767 20,314Technical result 652 766 1,844 1,950 2,492Investment return after insurance technical interest 338 152 580 434 585

Profit/loss for the period before tax 976 907 2,379 2,354 3,017Profit/loss for the period, continuing business 741 711 1,786 1,809 2,180Profit/loss for the period 733 715 1,804 1,804 2,208Run-off gains/losses, net of reinsurance 195 243 778 723 1,015 Key ratios Total equity 10,365 10,854 10,365 10,854 10,979Return on equity after tax (%) 29.4 27.0 24.8 22.0 22.1Number of shares, end of period (1,000) 60,598 59,880 60,598 59,880 60,695EarningspershareofDKK25 12.1 11.8 29.8 29.8 36.5 Premium growth in local currency -1.4 -3.4 0.1 -2.9 -0.1 Gross claims ratio 70.3 75.9 72.9 73.6 72.2Net reinsurance ratio 1.0 -6.6 -0.9 -2.0 -0.4

Claims ratio, net of reinsurance 71.3 69.3 72.0 71.6 71.8Gross expense ratio 16.4 15.5 16.5 15.7 16.4

Combined ratio 87.7 84.8 88.5 87.3 88.2

Combined ratio exclusive of run-off 91.5 89.8 93.6 92.2 93.2Run-off, net of reinsurance (%) -3.8 -5.0 -5.1 -4.9 -5.0Large claims, net of reinsurance (%) 3.5 1.7 1.7 2.4 2.3Weather claims, net of reinsurance (%) 1.1 0.0 1.6 1.4 1.8 Combined ratio on business areas Private 83.9 81.5 87.9 85.5 87.7Commercial 79.2 79.9 84.2 86.4 83.7Corporate 92.6 92.8 86.8 89.0 87.7Sweden 90.8 87.8 97.8 92.2 95.3


Tryg’s results

TrygpostedaprofitbeforetaxforQ32013ofDKK907m(DKK976m)

with results being positively impacted by improvements achieved

throughtheinternalefficiencyprogrammeaswellasalowlevel

of large claims after reinsurance. The investment return totalled

DKK152m(DKK338m),duetoahighreturnonequities,butreturn

onbondswasatasignificantlylowerlevelthanin2012.

Thetechnicalresultwasimprovedby17%toDKK766minQ32013

(DKK652m)andreflectstheeffectoftheefficiencyprogramme

implemented,which,takeninisolation,hadaneffectofDKK110m

eqalling 2.3% of the total improvement. The target for the total

reductioninclaimscostsandexpensesissavingsofDKK1bninthe

period up to 2015, and with the results achieved in Q3 2013, total

savingsofDKK455mhavesofarbeenrealised.

Our strategy aims at making Tryg stronger and more competitive and

to ensuring continuous improvements in earnings. Having introduced

significantpriceincreasesinrecentyears,Trygwillinfuturefocus,in

particular,onimprovingperformancethroughtheinternalefficiency

programme and cost cuts, the continued development of price-dif-

ferentiated products and improved customer programmes. Further

price measures will be introduced, but will selectively target schemes

orproductswhicharenotprofitable.However,thegeneralexpect-

ationisthatordinarypriceincreasesinlinewithinflationwillsuffice.

The combined ratio for the quarter was 84.8 (87.7), which was lower

than for the same period in 2012, and includes a 2.3 percentage

pointimprovementasaconsequenceoftheefficiencyprogramme

implemented. Furthermore, a lower level of weather claims and large

claims improved the combined ratio by 1.7 percentage points (4.6).

The expense ratio improved markedly from 16.4 to 15.5 as a result

of the cost-cutting measures implemented. The improvement was

achieved during a period with negative premium growth.

Withacombinedratioof84.8forQ32013,Tryghasfulfilledthe

target of an annual combined ratio of 90 or lower from Q3 2013,

and the long-term target is an annual level of 90 or lower to

underpin a return on equity of 20%.

TheinvestmentreturnwasDKK152m(DKK338m),consistingof

anegativematchportfolioreturnofDKK33m,afreeinvestment

portfolioreturnofDKK243mandanegativeimpactfromother

financialincomeandexpensesofDKK58m.

TheprofitaftertaxtotalledDKK715minQ32013(DKK733m),

corresponding to a return on equity of 27.0% (29.4%).

The Danish market is characterised by a slightly higher level of

consumerconfidenceandslightlyincreasingresidentialproperty

prices, but a continued unemplyment at approximately 6 %. Car sales

in Denmark are dominated by small cars. The Norwegian economy is

characterised by a low level of unemployment (approximately 3%),

low interest rates and rising real wages, which for Tryg entails

acontinuedfocusontheriskofclaimsinflationandtheresulting

need for price adjustments.

High customer satisfaction is very important for Tryg, and we are

therefore pleased that the customers have embraced our new price-

differentiatedproductsandthenewcustomerconceptintheDanish

market, which was announced in Q2 2013. In Q3, special focus was

on the Norwegian market, which saw the introduction of a new mo-

tor insurance product with parking cover. Parking cover ensures that

the customer claims are covered without loss of bonus. Experience

fromthedifferentiatedproductshasbeenpositive,andmarkedly

increased sales rates have been realised through improved selection

and risk-based pricing. The sales rates for the Travel insurance and

Caravan insurance products are thus up by between 20% and 30%.

Thespecialbenefitsprogramme,TrygPlus,whichwaslaunchedin

Q2 in Denmark, was given a very satisfactory reception by custom-

ers. Customers have shown particularly satisfactory interest in the

TrygHomeAlarmprogrammewherebyspecialbenefit-customers,

who have an alarm installed in their homes, pay a reduced premium

for their contents insurance due to the lower risk of being burgled or

incurringwaterandfiredamages.

A customer concept has been developed for the Norwegian market,

which is very similar to the Tryg Plus concept. The concept comprises

Tryg ID, Tryg Home Alarm and Tryg Backup.


Premiums

GrosspremiumincomewasDKK4,867minQ32013,corresponding

to a reduction of 3.4% in local currencies (-1.4%). The negative

development in premium income was in line with expectations and

emphasisesTryg’sfocusonprofitability.Aconsiderableincreasein

bonus and premium discounts was a contributory factor to the low

premiumgrowth.Thismustbeseeninlightoftheimprovedprofit-

ability of a number of major group agreements, and of the intro-

ductionofaprofitsharingelementintheagreementwithNordea,

whereas the earlier agreement was based primarily on the paying

of commission on new business. Exclusive of bonus and premium

discounts, negative growth of 2.2% was posted for Q3 2013 in local

currencies.

Further, the reduced premium income must be seen in light of the

profitability-improvingmeasuresintroducedearlierandwhichin

2012resultedinanincreasedoutflowofbusinessandlowersalesin

both the Private and Commercial business areas. The development

inpremiumincomeisalsoaffectedbymacroeconomicdevelop-

ments in Denmark, which have, among other things, impacted

private consumption and increased the demand for small cars.

This translates into a reduction in premium income, but also in

claims as safety levels are generally high, reducing the risk of claims.

Moreover, the commercial market in Denmark has been negatively

impacted in particular by lower private consumption, which has

led to hard times for this segment, resulting in job cuts and thereby

a declining demand for workers’ compensation insurance. This

decline in the demand for insurance has had a negative impact on

premium income.

In2013,developmentsintheprivatemarketwereaffectedbya

higher level of sales, but also by a slightly higher than expected

customeroutflowduetothefiercecompetitivesituation.Salesin

the commercial market were in line with expectations, given the

intensifying competition. In the corporate market, premium income

was lower than in 2012 due to the loss of a number of large custom-

ers.UnchangedprofitabilityisthefocusareafortheCorporate

segment,whichwillleadtopremiumincomefluctuationsover

time. This is due, among other things, to the regular entry of foreign

players on this market, leading to a loss of business for Tryg due to

itsfocusonprofitability.

Claims

The gross claims ratio was 75.9 (70.3). The claims ratio, net of ceded

business,was69.3(71.3).Thesubstantialdifferencebetweenthe

gross claims ratio and the claims ratio, net of ceded business, is

attributable to a large claim within guarantee insurance in respect

ofthefirmofcontractorsPihl&Søn,whichisexpectedtoadd

approximateyDKK0.7bntogrossclaims.Duetothenatureofthe

guarantee insurance business, reinsurance is used more widely

within this segment than within the rest of the general insurance

segment.Thismeansthattheeffectonresultswillbelimitedto

DKK30m.Moreover,Q3wasimpactedbyalowlevelofweather

claims and large claims corres ponding to 1.7% (4.6%).

The improved claims ratio, net of ceded business, can be ascribed,

in particular, to the measures implemented within the procurement

ofclaimsservicesandcostcuts.MeasuresworthDKK90mwere

implemented in Q3, corresponding to an improvement of 1.8 percen t -

age points. Relative to the target of claims prevention measures to-

tallingDKK350mattheendof2013,measurestotallingDKK330m

had been realised at the end of Q3. The combined target for the

periodupto2015isDKK700m.Whilethemeasureshavepreviously

centred primarily on motor, in Q3 greater focus was on the proc-

urement of claims services within building and contents insurance,

among other things through the use of Scalepoint. Moreover, the aim

is to leverage Tryg’s purchasing strength and to enter into agree-

mentswithcraftsmenbasedonfixedpricesforpre-definedjobs.

Tryghasextendedanoffertocustomerswherebytheycanhavetheir

basements checked by an authorised sewer contractor with a view

to assessing ways of reducing the risk of weather-related claims.

Moreover,TryghasintroducedTrygBurglarycheck,offeringburglary

checks conducted in collaboration with the Danish Locksmith

Federation. The target group has been customers who have been

burgled in the past 20 months. The initiatives have been welcomed

by customers who would generally be happy to recommend the

initiatives to other customers.

The large claims ratio was 1.7 (3.5) and was thus lower than the

approximately 2.3 expected for an average quarter. As mentioned

earlier, this includes a guarantee insurance claim, which has a

considerable impact on the gross claims ratio, but which has only

a limited impact on the results due to reinsurance.


Costs

The expense ratio was 15.5 (16.4), which represents a marked

improvement relative to the prior-year period and which must be

seen in the context of an expense ratio target of less than 15 in

2015. The lower expence ratio is to contribute to ensure competitive

productstothebenefitofbothcostomersandshareholders.The

improvedexpenseratioisattributable,inparticular,totheefficiency

programmeimplemented,whichaimsatreducingcostsbyDKK

300m in the period up until 2015. The cost reductions have primarily

beenachievedthroughjobcutsinstaffsupportfunctions.

TheongoingeffortstoreducecostlevelsfortheGroupfocusonthe

IT area. With the aim of ensuring stable IT operations and creating

scope for innovation, both the IT operations contract and central IT

development activities have been put out to tender.

Furthermore,decisionsconcerningthefutureofficestructurearealso

expectedtocontributetoincreasingefficiencyandtherebyreducing

costs.Thenewofficestructureisadabtedtothecustomers’needs

andhasresultedinareductioninthenumberofoffices.

Structural changes focusing on the establishment of larger units can

increaseefficiency,whileatthesametimereducedependenceon

single resources and improve the scope for collaboration. As a result

oftheefficiencyprogramme,Q3sawfurthercostreductionsofDKK

20m,withthecombinedcostreductionsnowstandingatDKK115m.

ThetotalcostreductiontargetisDKK125mbytheendof2013.

Inadditiontothecostreductionsintheeffiencyprogramme,the

premium level has been streamlined, which should be seen in light of

the expense ratio target of less than 15 in 2015 and the development

in premium income.

TheGroup’snominalcostlevelwasreducedbyalmostDKK100m

asaresultoftheefficiencyprogrammeimplemented,thegeneral

streamliningofcostlevelsandtheprovisioninQ32012ofDKK60m

forrestructuringcostsincidentaltotheefficiencyprogramme.Atthe

end of Q3 2013, the number of employees was 3,757, corresponding

to a reduction of 53 employees since Q1 2013 and a total of 156

employees since the beginning of the year.

Opnået

125

Target Achieved in 2012(55 DKKm)

Achieved in Q2 2013(20 DKKm)



300

250

200

150

100

50

0

300 115125

125

50

DKKm

Achieved 2014 20152013

Targets – expenses

Total savingsand expenses

Target Achieved in Q1 2013(45 DKKm)



800

700

600

500

400

300

200

100

0

700 100 120

250

250

100

Targets – claims

DKKm

Total savingson claims

2012 Achieved2012

2013 2014 2015Achieved2013

210


Asmentionedabove,focushasbeenonreducingstaffsupport

function costs, while some business areas have taken on more

employees to strengthen distribution.

Investment return

Tryg discounts technical provisions and matches the disbursement

profileoftheprovisionswithbonds.Investmentassetsotherthan

those included in the match portfolio are included in the free invest-

ment portfolio and are invested broadly.

ThereturnonthematchportfoliowasnegativeatDKK33m.

ThefreeinvestmentportfoliototalledDKK12.3bnattheendof

Q32013andyieldedagrossreturnintheperiodofDKK243m,

corresponding to a return of 2.0% (8.0% p.a.) on the average

invested capital.

Profit before and after tax

ProfitbeforetaxwasDKK907m(DKK976m).Theprofitforthe

periodaftertaxanddiscontinuedbusinesswasthusDKK715m

(DKK733m).Taxoncontinuingbusinessconstitutedanexpense

ofDKK196m,correspondingtoataxrateof21.6%.

Results for Q1-Q3 2013

ProfitbeforetaxwasDKK2,354m(DKK2,379m).Theslightlylower

resultofDKK25misattributabletoanimprovedtechnicalresult

ofDKK106m,whereastheinvestmentreturntotalledDKK434m

againstDKK580mintheprior-yearperiod.Thecombinedratiowas

improvedfrom88.5to87.3,ascribabletotheresultsoftheefficiency

programme which more than compensated for a higher level of large

claims.Run-offwas4.9%,whichisaboutthesamelevelasin2012

whenrun-offwas5.1.

The claims ratio, net of ceded business, was 71.6 (72.0) and

waspositivelyimpactedbytheefficiencyprogramme,whichmore

than compensated for a higher level of weather claims and large

claims in all.

Themeasuresimplementedaspartoftheefficiencyprogramme

have been supplemented by a large number of customer-oriented

initiativesintheformofnewcustomerconceptsandnewdifferent-

iated products in both the Danish and Norwegian markets.

Capital

Tryg’sequitytotalledDKK10,854mattheendofQ32013.Tryg

determines the individual solvency need according to the Danish

Financial Supervisory Authority’s guidelines. The individual solvency

requirementtotalledDKK6,424mattheendofQ32013andshould

beseeninrelationtoacapitalbaseofDKK11,622m.Trygthushasa

surpluscoverofDKK5,198m,correspondingtoabufferof81%.

Mid-March,TryginitiatedasharebuybackintheamountofDKK

800m,with1,103,890sharesatatotalamountofDKK540m

having been bought back at the end of Q3 2013. The buy back

will be completed at the end of 2013.


Private

Keyfigures–Private DKKm Q3 2012 Q3 2013 Q1-Q3 2012 Q1-Q3 2013 FY 2012

Gross premium income 2,478 2,329 7,284 7,076 9,733Gross claims -1,709 -1,507 -5,367 -4,865 -7,084Gross expenses -372 -351 -1,141 -1,084 -1,524

Profit/loss on gross business 397 471 776 1,127 1,125Profit/loss on ceded business 2 -39 108 -100 81Insurance technical interest, net of reinsurance 5 8 23 22 27

Technical result 404 440 907 1,049 1,233Run-off gains/losses, net of reinsurance 77 58 286 238 326

Key ratios Premium growth in local currency 1.8 -2.9 1.8 -2.3 1.5

Gross claims ratio 69.0 64.7 73.7 68.8 72.8Net reinsurance ratio -0.1 1.7 -1.5 1.4 -0.8Claims ratio, net of reinsurance 68.9 66.4 72.2 70.2 72.0Gross expense ratio 15.0 15.1 15.7 15.3 15.7

Combined ratio 83.9 81.5 87.9 85.5 87.7Combined ratio exclusive of run-off 87.0 84.0 91.8 88.9 91.0Run-off, net of reinsurance (%) -3.1 -2.5 -3.9 -3.4 -3.3Large claims, net of reinsurance (%) 0.0 0.0 0.0 0.0 0.1Weather claims, net of reinsurance (%) 1.9 0.4 2.4 1.6 2.4

Private encompasses the sale of insurance products to private

individuals in Denmark and Norway. Sales are effected via call

centres, the Internet, Tryg’s own agents, franchisees (Norway),

interest organisations, car dealers, estate agents and Nordea’s

branches. The business area accounts for 48% of the Group’s

total premium income.

Results for Q3 2013

PrivatepostedatechnicalresultofDKK440m(DKK404m),

corresponding to an increase of approx. 10%, which is attributable,

inparticular,totheefficiencyprogrammeimplemented.Thelevel

ofweatherclaimsandrun-offgainswasonroughlythesamelevel

as in the prior-year period, and the underlying improvement in the

combined ratio totalled 1.5%.

In Q3, the Private market in Denmark was characterised by budding

optimism and also by slightly higher activity levels in the housing

market. Sales of private cars plummeted in July, but August saw

the same positive trends as last year, and so far sales of new cars

are up 5.2% in 2013 relative to last year. Sales were still dominated

by strong sales of small cars with more safety features, resulting

in lower average insurance premiums. The Norwegian economy

remains characterised by growth, a high level of private consump-

tion, low unemployment and pay increases of approx. 4%. All in all,

car sales for the months of July and August were about 2% down

on the prior-year period, whereas 2013 has seen growth of 0.6% to

date.Norwegianinflationremainslow,butasthedevelopmentin

pay levels has a bearing on many repairs, Tryg continues to monitor

thisdevelopmentcloselyinordertobeabletoadjustthetariffsfor

the individual products.


Premiums

Grosspremiumincomedecreasedby2.9%andwasaffectedbyboth

thecompetitivesituation,profitsharingandthenewdistribution

agreement with Nordea. Initiatives introduced in recent years to

improveprofitabilityhavealsoresultedinimprovedresultsingroup

agreementsthatincludeaprofit-sharingelement.Thismeans,of

course,thatthelevelofprofitsharingishigherthanpreviously,while

thedistributionagreementwithNordeaalsoincludesprofitsharing.

Exclusive of bonus and premium discounts, negative growth of 1.4%

was posted for Q3 2013. The strong sales of small cars with many

safety features also mean that premium income is reduced, as the

risk and thus the price of insurance are lower.

The renewal rate was at a high level, though a slight decrease was

recorded in Denmark. In the Norwegian market Private has seen a

positiveinflowofcustomers.Thedevelopmentinpremiumincomeis

alsoinfluencedbytheprofitability-enhancinginitiativesintroducedin

recent years, leading to a small fall in retention rate which, moreover,

has been increasing for several years.

In the Private segment, continued focus has been on developing

price-differentiatedproductsandnewcustomerconceptsinthe

formofspecialbenefitsprogrammesforcustomers.Themoreprice-

differentiatedproductsare,amongotherthings,characterisedby

theinclusionofsignificantlymoreparametersincalculatingtheright

price. Thus, the number of parameters included for travel insurance

have been increased from 1 to 4, and for leisure house insurance the

number of parameters has been increased from 2 to 14. It has also

been important that many of the additional parameters are accessed

via external data. In our contact with potential customers, we can

clearly see that the rate of sales has been higher than for the old non-

differentiatedproducts.Thehighsalesratehasalsobeenpositively

influencedbythesignificantlybetterselcetionofpotentialcustomers.

Initially, the focus has been directed at the Danish market, and the

customers’reactiontothenewprice-differentiatedproductswithin

contents, travel insurance, leisure house and caravan insurance

shows that it is right to develop these products.

A new house insurance was launched in the Norwegian market in

Q2,andinQ3Trygwasthefirstcompanytointroduceanewtypeof

motor insurance cover which means that customers no longer lose

bonus points in connection with damage to their parked car caused

by another car, and where it is not known who caused the damage.

Trygisthefirstcompanytolaunchthiscover,andmanycustomers

have welcomed this step.

IntheDanishmarket,Tryglaunchedanewspecialbenefitspro-

gramme in Q2 (Tryg Plus), which in addition to the well-known

benefitsisverymuchbasedoncustomerneeds.Thishasledtothe

benefitsTrygID,TrygSafeinLife,TrygHomeAlarmandTrygBackup.

The new concept has been well received, with customers already

showing a lot of interest in Tryg Home Alarm in particular.

In the Norwegian market, a Tryg Plus concept has just been launched

which is structured much like the Danish concept.

Claims

The gross claims ratio was 64.7 (69.0). The claims ratio, net of ceded

business, was improved from 68.9 to 66.4, with most of the 2.5 per-

centagepointimprovementbeingascribedtotheongoingefficiency

programme, which addresses both improved procurement of claims

servicesandamoreefficientclaimshandlingorganisation.The

underlying level was thus improved by 1.6 percentage points.

Costs

The expense ratio for Private was 15.1 (15.0) as a result of continued

improvementsfollowingthestreamliningofstaffsupportfunctions

and lower up-front commissions to Nordea. Striking the right balance

betweenprofitabilityandnewbusinessisstillTryg’smainfocus.

However,owingtoaneedtostrengthensalesefforts,thenumber

of employees has been increased, and at the end of Q3 totals 930

against 919 at the end of Q2.


AprofitofDKK1,049m(DKK907m)waspostedforQ3asaresultof

the initiatives implemented. The combined ratio for Q1-Q3 2013 was

85.5 (87.9), representing an improvement of 2.4 percentage points.

All in all, the Private segment results for Q1-Q3 are very satisfactory

andprovideasoundbasisforthecontinuedworkonproductdiffer-

entiation and the continued development of customer concepts.


Commercial

Keyfigures–Commercial DKKm Q3 2012 Q3 2013 Q1-Q3 2012 Q1-Q3 2013 FY 2012

Gross premium income 931 859 2,781 2,666 3,687Gross claims -529 -475 -1,830 -1,747 -2,372Gross expenses -187 -176 -567 -522 -748

Profit/loss on gross business 215 208 384 397 567Profit/loss on ceded business -21 -35 57 -35 32Insurance technical interest, net of reinsurance -1 4 7 7 5

Technical result 193 177 448 369 604Run-off gains/losses, net of reinsurance 66 75 183 146 212

Key ratios Premium growth in local currency -2.9 -5.8 -1.6 -3.8 -2.0

Gross claims ratio 56.8 55.3 65.8 65.5 64.3Net reinsurance ratio 2.3 4.1 -2.0 1.3 -0.9Claims ratio, net of reinsurance 59.1 59.4 63.8 66.8 63.4Gross expense ratio 20.1 20.5 20.4 19.6 20.3

Combined ratio 79.2 79.9 84.2 86.4 83.7Combined ratio exclusive of run-off 86.3 88.6 90.8 91.9 89.4Run-off, net of reinsurance (%) -7.1 -8.7 -6.6 -5.5 -5.7Large claims, net of reinsurance (%) 0.0 0.0 0.4 2.8 1.5Weather claims, net of reinsurance (%) 0.9 -0.3 1.2 1.4 1.9

Commercial encompasses the sale of insurance products to small

and medium-sized businesses in Denmark and Norway. Sales are

effected by Tryg’s own sales force, franchisees (Norway), customer

centres as well as through group agreements. The business area

accounts for 18% of the Group’s total premium income.

Results

ThetechnicalresultforCommercialwasDKK177m(DKK193m).

Thisissatisfactoryanddemonstratestheeffectoftheinitiatives

implemented, the structural adjustments to improve cost levels,

as well as the streamlining of the distribution. Commercial will

continue to focus on the streamlining of internal processes and on

theongoingstreamliningofdistribution.Concurrently,effortswill

continue to improve the segmentation and the pricing of key prod-

ucts.Inthiscontext,Commercialhasobservedapositiveeffectof

animprovedtariffwithinworkers’compensationinsurance,which

has contributed to increasing competitiveness and selection and

thereby activity levels in the distribution.

The combined ratio was 79.9 (79.2), which is a very low level and

which is partly attributable to the fact that Q3 is usually better than

the year as a whole.

The market situation for the commercial area did not change

significantlyinQ32013andisstillverydifferentinDenmarkand

Norway.Despiteaslightlyhigherlevelofconsumerconfidence,the

Danish market is characterised by a low level of private consumption,

investment caution and a restrained appetite for lending by the

banks, which all in all impacts business negatively. The situation in

Norway is largely unchanged with a positive market for small and

medium-sized businesses based on a high level of private consumption.

Premiums

GrosspremiumincomeforQ3amountedtoDKK859m(DKK931m),

corresponding to a decrease of 5.8% in local currencies. The negative

developmentinpremiumincomewasexpectedfollowingtheprofit-

abilitymeasuresimplemented.Thegrowthisalsoimpactedbyprofit


sharing and the regulation of some products in the Norwegian part

ofthebusiness,thecombinedeffectbeing1.7%.Activitylevels

improved in the past quarter, while customer retention developed

positively in both Denmark and Norway.

Inadditiontotheprofitabilitymeasuresimplemented,anewworkers’

compensationtariffhasbeenintroducedinbothDenmarkand

Norway,whichfarbetterreflectsvariationsinriskforthevarious

segmentsandthusthepreparationofquotesfordifferentsegments.

Thisisalsoreflectedinthefactthattariffadjustmentsintheform

of either price reductions or increases are now far less common.

Commercial’s share of the Norwegian market is considerably lower

than its share in the Danish market, and the distribution setup will

therefore be strengthened in Norway with a view to increasing this

share,whileatthesametimefocusingonmaintainingtheprofit-

ability which has been attained.

Claims

The gross claims ratio was 55.3 (56.8), and the claims ratio, net of

ceded business, was 59.4 (59.1). The development in the claims

ratio, net of ceded business, is due to Tryg’s own measures to

improve the claims procedure within, in particular, the building and

contents insurance market as well as a reduction in the number of

employees involved in claims handling.

Costs

The expense ratio was 20.5, representing an increase which must

be seen in light of the lower premiums. However, the nominal cost

level has been reduced by about 6%, which must be seen in the

context of the objective of improving cost levels for the purpose of

improving Commercial’s competitiveness.

As mentioned above, cost levels must be improved through process

optimisationinCommercialandmoreefficientdistribution,which

istobeachieved,amongotherthings,througharedefinitionofthe

tasks to be performed by Commercial insurance agents and those

to be performed by service centres and outbound sales channels.

The number of employees in Commercial was 507 at the end of

Q3, down by 57 since the beginning of 2013, when the number of

employees was 564.


AprofitofDKK369m(DKK448m)waspostedforQ1-Q3,resulting

fromanimprovementinprofit,basedonmeasureswithinpricing,

pruningoftheloss-makingportfolioandtheeffectofthecostand

claims measures implemented, but which was also negatively

impacted by a considerably higher level of weather claims and

largeclaims.Thehigherlargeclaimslevelisduetothefiredamage

to a listed manor house in Denmark. The combined ratio was 86.4

in Q1-Q3 2013 (84.2), which, adjusted for the level of large claims,

weatherclaimsandrun-offaswellastheinterestratelevel,

corresponds to an improvement of 2 percentage points.

Generally, Q1-Q3 2013 progressed as expected with an underlying

improvementofthecombinedratioasaresultofprofitability

measuresandefficiency-improvingmeasuresaswellasanexpected

small reduction in business volume due to price increases, pruning

and lower economic growth.


Corporate sells insurance products to corporate customers under

the brand ‘Tryg’ and ‘Tryg Garanti’ in Denmark and Norway and

‘Moderna’ in Sweden. Sales are effected both via Tryg’s own

sales force and via insurance brokers. Moreover, customers with

international insurance needs are served by Corporate through its

cooperation with the AXA Group. The business area accounts for

26% of the Group’s total premium income.

Results for Q3 2013

AprofitofDKK95m(DKK95m)waspostedandinfluenced,among

otherthings,byalargeclaimwithinTrygGaranti,whichsignificantly

impactedthegrossclaimslevelbyDKK0.7bn.Theimpactonprofit

is limited, however, as it has been decided to maintain a higher

reinsurance level for this type of business. This is due to the fact

that guarantee insurance is more market-sensitive than Corporate’s

other business activities. The results from the guarantee insurance

business have generally been satisfactory and will have contributed

positively to Tryg’s earnings, also after recognition of this claim.

Thecombinedratiowas92.8(92.6)andwasaffectedbyahigher

level of medium-sized claims, which can especially be referred to

motor,liabilityinsuranceandproperty.Therun-offlevelwassome-

what higher than in Q3 2012. As a consequence of the longer duration

andthushigherlevelofprovisionsinCorporate’sportfolio,therun-off

result will normally be higher than for the other business areas.

TheDanishCorporatesegmentisaffectedbythedifficulteconomic

situation in the Danish market. The insurance needs of Danish

businesses are growing only slightly, and factors such as a rising

number of bankruptcies and foreign acquisitions have contributed

to reducing business volume. The Norwegian market continues to

bepositivelyaffectedbysoliddomesticgrowth.Theeconomic

Corporate

Keyfigures–Corporate DKKm Q3 2012 Q3 2013 Q1-Q3 2012 Q1-Q3 2013 FY 2012

Gross premium income 1,311 1,241 3,928 3,798 5,258Gross claims -1,025 -1,387 -2,894 -3,326 -3,929Gross expenses -156 -153 -486 -471 -648

Profit/loss on gross business 130 -299 548 1 681Profit/loss on ceded business -33 389 -28 416 -37Insurance technical interest, net of reinsurance -2 5 9 10 6

Technical result 95 95 529 427 650Run-off gains/losses, net of reinsurance 62 101 337 341 506

Key ratios Premium growth in local currency -6.0 -2.1 -2.3 -3.0 -2.0

Gross claims ratio 78.2 111.8 73.7 87.6 74.7Net reinsurance ratio 2.5 -31.3 0.7 -11.0 0.7Claims ratio, net of reinsurance 80.7 80.5 74.4 76.6 75.4Gross expense ratio 11.9 12.3 12.4 12.4 12.3

Combined ratio 92.6 92.8 86.8 89.0 87.7Combined ratio exclusive of run-off 97.3 100.9 95.4 98.0 97.3Run-off, net of reinsurance (%) -4.7 -8.1 -8.6 -9.0 -9.6Large claims, net of reinsurance (%) 13.9 6.7 6.2 7.3 7.6Weather claims, net of reinsurance (%) 0.2 -0.7 0.6 1.0 0.6


situation in Sweden has no major impact on the Corporate portfolio

as the portfolio is still in the development phase.

Premiums

PremiumincomewasDKK1,241m(DKK1,311m),representing

a drop of 2.1% in local currencies. The reduction in premium

income is mainly due to the measures implemented to improve

theportfolio’sprofitability.

Thelargestoutflowofcustomerswasseeninthesegmentsserved

bybrokers,andtheNorwegianmarketsawparticularlyfierceprice

competitionwithinpersonalinjuryinsurance.Itisdifficulttoprice

this type of business correctly, and Tryg has chosen to maintain a

profitablepricelevelbasedonTryg’sexperience.Forsometime,

thishasmadeitdifficulttoattractnewbusinessaspricelevelsin

the market have been too low. In the course of 2013, however,

an improvement has been seen in these conditions, and Tryg has

successfully entered into new agreements with a number of major

customers.

To increase loyalty, self-service solutions have been developed for

specificallyNorwegianpersonalinjuryinsurancecustomers,offering

customers their own portal and thus a place where they can eas-

ily gain an overview of their entire insurance programme. Tryg’s

customers appreciate the simple approach to insurance, and, in

addition to forging closer ties with customers, the solution is also

an asset in connection with sales to new customers.

The Swedish Corporate segment posted growth of approximately

8%,reflectingcontinuedcontrolledgrowthwithfocusonprofitability.

In this context, it is a strength that many brokers view Moderna as

the preferred company.

Claims

The gross claims ratio stood at 111.8 (78.2), while the claims ratio,

net of ceded business, was 80.5 (80.7). The high gross claims level

can be attributed to the claim mentioned within Tryg Garanti. The

run-offlevelwashighforthequarter,butonaparwithprevious

quarters, and medium-sized claims were also at a higher level, as

mentioned.

Costs

The expense ratio totalled 12.3 (11.9), and the higher level is mainly

attributable to the reduction in business volume, which is also

reflectedinareductioninthenominalcostlevel.


TheprofitforQ1-Q32013totalledDKK427m(DKK529m).

The combined ratio for Q1-Q3 was 89.0 (86.8) and can primarily

be ascribed to the higher large claims level.

All in all, the results are satisfactory, and the lower premium level

emphasisesTryg’sfocusonprofitability,whichisalsoreflected

in an improved underlying claims level, while activities will be im-

plemented with a view to tailoring costs to the lower premium level.


Sweden

Keyfigures–Sweden DKKm Q3 2012 Q3 2013 Q1-Q3 2012 Q1-Q3 2013 FY 2012

Gross premium income 477 442 1,255 1,239 1,654Gross claims -359 -321 -999 -928 -1,267Gross expenses -69 -65 -222 -213 -306

Profit/loss on gross business 49 56 34 98 81Profit/loss on ceded business -5 -2 -6 -1 -3Insurance technical interest, net of reinsurance 4 0 20 8 24

Technical result 48 54 48 105 102Run-off gains/losses, net of reinsurance -10 9 -28 -2 -29

Key ratios Premium growth in local currency -1.5 -4.7 0.6 -3.1 0.7

Gross claims ratio 75.3 72.6 79.6 74.9 76.6Net reinsurance ratio 1.0 0.5 0.5 0.1 0.2Claims ratio, net of reinsurance 76.3 73.1 80.1 75.0 76.8Gross expense ratio 14.5 14.7 17.7 17.2 18.5

Combined ratio 90.8 87.8 97.8 92.2 95.3Combined ratio exclusive of run-off 88.7 89.8 95.6 92.0 93.5Run-off, net of reinsurance (%) 2.1 -2.0 2.2 0.2 1.8Weather claims, net of reinsurance (%) 0.0 0.0 1.2 1.2 1.2

Sweden comprises the sale of insurance products to private

customers under the ‘Moderna’ brand. Sales are effected via Tryg’s

own sales people, call centres and the Internet. This business area

accounts for 8% of the Group’s total premium income.

Results for Q3 2013

TheprofitforSwedenwasDKK54m(DKK48m).Theprofitissatis-

factorythankstothemanyprofitabilitymeasuresimplementedin

the Swedish business. The niche areas comprising leisure boats, car

sports/motorcycles and product insurance reported good results.

The results for the Private segment as such were satisfactory. The

combinedratiowasreducedto87.8(90.8),thusbeingthefirst

time a combined ratio under 90 for Sweden was attained. The low

combined ratio was made up by a solid improvement in the level

of claims and a slightly higher cost level, which, however, was at a

very satisfactory level.

Premiums

PremiumincomewasDKK442m(DKK477m)inQ32013,

representing a fall of 4.7% in local currencies. The negative devel-

opment in premium income was expected as a consequence of

the structural measures implemented in the form of the termination

of the distribution agreement with Nordea and the relocation of

the distribution from Luleå to Malmö. These measures contributed

significantlytoimprovingprofitability.


TheworkonestablishinganefficientdistributionchannelinMalmö

continuesasplanned,butthefinalstructureisnotexpectedto

be fully in place until the end of the year. The closing of the Luleå

officeisalsoproceedingaccordingtoplan,andnegotiationshave

been initiated with a third party about the takeover of premises

and employees. An agreement with new partners in replacement

of the discontinued one with Nordea is in progress.

Moderna’snewbenefitsprogramme,ModernaBonuskund,

has resulted in more policies being taken out and more products

being sold per customer. In September, a new product structure

was launched, which is divided into small, medium and large.

The ‘large’ product has received an excellent ranking from the

Swedish consumer organisation.

To achieve synergies in the distribution, cross-selling of private

insurance has been initiated between the leisure boat insurance

and car sports/motorcycle niche areas, which has progressed

satisfactorily. In general, sales of leisure boats are up, which can

be attributed to a good summer which stimulated interest in the

leisure boat market.

Claims

The claims ratio for Q3 2013 was 72.6 (75.3), which is an ex-

pectedpositivedevelopmentowingtotheprofitabilitymeasures

implemented. Moderna is characterised by high claims handling

efficiency,with35-45%ofallclaimsbeingfinalisedonthedayof

reporting.

Costs

The expense ratio was 14.7 (14.5), which is a very satisfactory

level, particularly in light of the business volume. The integration

of the IT systems from the original Swedish business and the

acquired Moderna’s systems has progressed satisfactorily and

willimproveefficiencygoingforward.


TheprofitforQ1-Q32013totalledDKK105m(DKK48m).The

combined ratio was 92.2 in Q1-Q3 2013 (97.8). The improvement

canbeascribedtotheaboveprofitabilitymeasuresandmeasures

aimed at reducing nominal costs.

The results posted by the Swedish business are very satisfactory

and were achieved concurrently with the launch of new customer

concepts, which have been well received by the Swedish market.

The cross-selling activities are also promising.


Investment activities

a) The item comprises interest on operating assets and bank debt, exchange rate adjustments of insurance items and costs of investment activities.

Keyfigures–Investmentactivities Return Return Q3 2013 Investment assetsDKKm Q3 2012 Total Match Free 31.12.12 30.09.13

Bonds, cash deposits, etc. 529 119 59 60 40,431 39,095Equities 144 160 160 2,444 2,779Real estate 30 23 23 2,082 2,055

Total 703 302 59 243 44,957 43,929Value adjustments, changed discount rate -193 39 39 Transferred to insurance technical interest -114 -131 -131

Total investment return before other financial items 396 210 -33 243 Other financial income and expenses, investments* -16 -10

Total investment return 380 200 Other financial income and expenses, non-investment a) -42 -48

Total investment 338 152

InQ32013,Tryg’stotalinvestmentportfolioofDKK43.9bnyieldeda

grossreturnofDKK302m(DKK703m),correspondingtoareturnof

0.7% on the average invested capital during the period. After transfers

to insurance technical interest, the net investment return totalled

DKK210m(DKK396m).Otherfinancialincomeandexpenseswas

negativewithDKK58minQ32013(DKK-58m),includingexpenses

ofDKK23mtothesubordinateloancapital.

ThisbringsthetotalinvestmentreturntoDKK152minQ3

(DKK338m).Theresultswereachievedagainstabackgroundof

extremely positive equity markets and positive developments in the

creditmarkets.Therefor,inspiteoftheconflictinSyria,risinginterest

rates and the increasing uncertainty about the US budget and debt

ceiling,TrygachievedsatisfactoryresultsofDKK243minthefree

portfolio(DKK370m),fromwhichanegativemismatchofDKK33m

shouldbedeductedinQ3(DKK26m).

Match portfolio

Tryg matches the insurance provisions with the assets in the match

portfoliosothatchangesininterestratelevelsaffectTryg’sresultsas

little as possible. This leads to generally lower variation in the results

and will under Solvency II reduce the capital requirement needed to

accommodatefluctuations.

The return on the match portfolio must cover price adjustments of

the claims provisions and the insurance technical interest. Tryg’s aim

is to reduce deviations as much as possible, which in Q3 2013 was

reflectedinanegativemismatchofDKK33m,correspondingtoa

deviation of around 0.1% of the securities in the match portfolio.

In the generally optimistic environment in Q3, the Nordic region’s

status as a safe haven has come to play a clearly less important role

to especially foreign investors. Thus, the Danish/German and the

Norwegian/Germaninterestrategapswidenedsignificantlyduring

the quarter, and the Nordic bonds lost ground to the German bonds.

With a local swap hedge in the match portfolio, the mismatch of

DKK35minH1wasreducedtoDKK2myeartodate.

ThematchportfoliowasreducedbyDKK0.5bnintheperiod,

amountingtojustoverDKK31.6bnattheendofQ32013.The

reduction in the match portfolio primarily results from a reduction

in the value of Tryg’s provisions, which are typically reduced in the

course of the calendar year and then increase again in January.


a) The item comprises interest on operating assets and bank debt, exchange rate adjustments of insurance items and costs of investment activities.

Keyfigures–Investmentactivities Return Return Q1-Q3 2013 Investment assetsDKKm Q1-Q3 2012 Total Match Free 31.12.12 30.09.13

Bonds, cash deposits, etc. 1,357 221 85 136 40,431 39,095Equities 202 401 401 2,444 2,779Real estate 162 71 71 2,082 2,055

Total 1,721 693 85 608 44,957 43,929Value adjustments, changed discount rate -371 280 280 Transferred to insurance technical interest -420 -363 -363

Total investment return before other financial items 930 610 2 608 Other financial income and expenses, investments* -50 -26

Total investment return 880 584 Other financial income and expenses, non-investment a) -300 -150

Total investment 580 434

Free investment portfolio

The free investment portfolio is mainly made up of equities, real

estate and bonds and in Q3 2013 generated a total gross return of

DKK243m,correspondingto2.0%(8.0%p.a.)ontheaveragein-

vestedcapital.Thefreeportfolioamountedtoapprox.DKK12.3bnat

theendofQ32013,upDKK0.4bncomparedtotheendofQ22013.

ThepoliticaluncertaintyintheUSA,intermsofbothfiscaland

monetary policy, had an impact on the return on Tryg’s free portfolio

in Q3. The postponement of the US Federal Reserve’s gradual reduc-

tionofbondpurchasescameasasurprisetothefinancialmarkets,

but also served to curb rising interest rates. Thus, the concern about

developments in emerging market securities was also allayed, resulting

inareturnonTryg’sfreebondportfolioofDKK60m.Theequity

markets were also boosted by the US Federal Reserve rhetoric, and

Tryg’sfreeequityportfoliogeneratedapositivereturnofDKK160m

in Q3, corresponding to 6.3% (25% p.a.). In comparison, the global

index yielded a return of 6.4% in Q3.

The real estate portfolio, comprising Danish and Norwegian invest-

mentproperties,generatedareturnofDKK23minQ32013,which

was in line with expectations.

Other financial income and expenses

OtherfinancialincomeandexpenseswerenegativeatDKK58m

in Q3 2013. This is attributable, among other things, to Tryg’s

currency hedging of the Swedish and Norwegian branches’ capital

ofDKK12m,aswellasexpensesrelatingtoTryg’ssubordinate

loansofDKK23m.


Tryg’stotalinvestmentportfolioyieldedagrossreturnofDKK693m

(DKK1,721m).Aftertransferstoinsurancetechnicalinterest,the

netinvestmentreturntotalledDKK610m(DKK930m).Thebond

portfolioasawholeyieldedareturnofDKK221minthefirstthree

quarters of 2013. Year-to-date, the match portfolio has delivered

alowerbutpositivemismatchofDKK2m.Thefreeinvestment

portfolioyieldedatotalreturnofDKK608minthefirstthreequarters

of2013,withequitiesaccountingforDKK136m,sharesDKK401m

andtherealestateportfolioforDKK71m.


Capital

6,424

5,198

8,132

4,347

Capital

DKKm

12,000

10,000

8,000

6,000

4,000

2,000

0

Capital requirement Bu�er

Individual Solvency Solvency II

Trygcalculatesthecapitalrequirementundertwodifferentcapital

regimes. One capital regime concerns the statutory capital as

definedintheDanishFinancialBusinessAct(Lov om finansiel

virksomhed), in which the Danish authorities require active capital

management through the quarterly calculation of an individual

solvency need. Tryg’s calculation of the individual solvency need

is based on the Group’s internal capital model. The other capital

regime concerns the future Solvency II, where Tryg calculates the

capital requirement according to the latest version of the standard

model under Solvency II.

Tryghasaninteractive‘A-’ratingfromStandard&Poor’s,andthe

capitalwillbesufficienttosupportthisrating.

Statutory capital

TheindividualsolvencyneedwasDKK6,424minQ22013against

DKK6,486minQ22013.Thisshouldbeseeninlightofthecapital

base,whichstoodatDKK11,622minQ32013.AttheendofQ2

2013,thecapitalbasewasDKK10,841m.Thisentailsasurplus

coverofDKK5,198m,correspondingtoabufferof81%inQ32013

againstasurpluscoverofDKK4,355m,correspondingtoabuffer

of 67%, at the end of Q2 2013.

Solvency II standard model

The capital requirement under the standard model (SCR) was

DKK8,132minQ32013againstDKK8,140minQ22013.Own

fundswereDKK12,479minQ32013,resultinginasurpluscover

ofDKK4,347m,orabufferof53%.AttheendofQ22013,own

fundsamountedtoDKK12,008m,correspondingtoasurplus

coverofDKK3,868m,orabufferof48%.

New individual solvency calculation rules

The Danish Financial Supervisory Authority is preparing new

individual solvency need calculation rules which are scheduled

totakeeffecton1January2014.Therulesarecurrentlysubject

to a public consultation, and Tryg takes part in this process. There

isstillconsiderableuncertaintyastothewordingofthefinal

Act,butthemainaimistoensureauniformconfidencelevel

correspondingtoa99.5%confidenceleveloveraone-yeartime

horizon, based on the forthcoming Solvency II standard model.

Furthermore, it will be possible to use internal models if it can

be demonstrated that such models guarantee the same level of

confidenceasaminimum.

Share buy back

Mid-March, Tryg initiated a share buy back in the amount of

DKK800m,with1,103,890sharesatatotalamountof

DKK540mhavingbeenboughtbackattheendofQ32013.

The share buy back will be realised at the end of 2013.


Outlook

The target of a return on equity after tax of 20% and a combined

ratio of 90 or lower from Q3 2013 was attained.

Moving forward, the target remains of delivering a full-year

combined ratio of 90 or lower and a cost level under 15% from

2015, which will ensure a return on equity after tax of 20%.


Disclaimer

Certain statements in this interim report are based on the beliefs of

our management as well as assumptions made by, and information

currently available to, management. Statements regarding Tryg’s

futureoperatingresults,financialposition,cashflows,business

strategy, plans and future objectives other than statements of historical

factcangenerallybeidentifiedbytheuseofwordssuchas‘targets’,

‘believes’, ‘expects’, ‘aims’, ‘intends’, ‘plans’, ‘seeks’, ‘will’, ‘may’,

‘anticipates’, ‘would’, ‘could’, ‘continues’ or similar expressions.

Anumberofdifferentfactorsmaycausetheactualperformance

todeviatesignificantlyfromtheforward-lookingstatementsinthis

interim report, including but not limited to general economic develop-

ments, changes in the competitive environment, developments in the

financialmarkets,extraordinaryeventssuchasnaturaldisastersor

terrorist attacks, changes in legislation or case law and reinsurance.

Read more in the chapter Risk management in note 1 in the annual

report 2012 for a description of some of the factors which may affect

the Group’s performance or the insurance industry.

Should one or more of these risks or uncertainties materialise,

or should any underlying assumptions prove to be incorrect, Tryg’s

actualfinancialconditionorresultsofoperationscouldmaterially

differfromwhatisdescribedhereinasanticipated,believed,

estimated or expected. Tryg is not under any duty to update any of

the forward-looking statements or to conform such statements to

actual results, except as may be required by law.

Contents–Financialstatements

Financial statements Q1-Q3 2013 Page

Statement by the Supervisory Board and the Executive Management 22

Financial highlights 23

Income statement 24

Statement of comprehensive income 25

Statement of financial position 26

Equity 28

Cash flow statement 30

Notes 31

Quarterly outline 40


Statement by the Supervisory Board and the Executive Management

The Supervisory Board and the Executive Management have today

considered and adopted the interim report for Q3 2013 for Tryg A/S.

The report, which has not been audited or reviewed by the company

auditors, is presented in accordance with IAS 34 Interim Financial

Reporting, the Danish Financial Business Act and the reporting

requirements of Nasdaq OMX Copenhagen for listed companies.

In our opinion, the report gives a true and fair view of the Group’s

assets,liabilitiesandfinancialpositionat30September2013,and

oftheresultsoftheGroup’sactivitiesandcashflowsfortheperiod.

Furthermore, in our opinion the management’s review gives a true

andfairviewofdevelopmentsintheactivitiesandfinancialposition

oftheGroup,theresultsfortheperiodandoftheGroup’sfinancial

positioningeneral,anditdescribessignificantriskanduncertainty

factorswhichmayaffecttheGroup.

Ballerup, 10 October 2013

Executive Management

MortenHübbe TorMagneLønnum LarsBonde

Group CEO Group CFO Group Executive Vice President and COO

Supervisory Board

JørgenHunoRasmussen TorbenNielsen PaulBergqvist

Chairman Deputy Chairman

Vigdis Fossehagen Lone Hansen Jesper Hjulmand

Bill-Owe Johansson Ida Sofie Jensen Anya Eskildsen

LeneSkole TinaSnejbjerg MariThjømøe


DKKm Q3 2012 Q3 2013 Q1-Q3 2012 Q1-Q3 2013 FY 2012

Gross premium income 5,196 4,867 15,238 14,767 20,314Gross claims -3,653 -3,692 -11,110 -10,865 -14,675Total insurance operating costs -844 -745 -2,476 -2,290 -3,295

Profit/loss on gross business 699 430 1,652 1,612 2,344Profit/loss on ceded business -53 319 133 291 86Insurance technical interest, net of reinsurance 6 17 59 47 62

Technical result 652 766 1,844 1,950 2,492Investment return after insurance technical interest 338 152 580 434 585Other income and costs -14 -11 -45 -30 -60

Profit/loss before tax 976 907 2,379 2,354 3,017Tax -235 -196 -593 -545 -837

Profit/loss, continuing business 741 711 1,786 1,809 2,180Profit/loss on discontinued and divested business after tax a) -8 4 18 -5 28

Profit/loss for the period 733 715 1,804 1,804 2,208

Run-off gains/losses, net of reinsurance 195 243 778 723 1,015 Statement of financial position Total provisions for insurance contracts 35,574 34,425 35,574 34,425 34,355Total reinsurers’ share of provisions for insurance contracts 2,322 2,628 2,322 2,628 2,317Total equity 10,365 10,854 10,365 10,854 10,979Total assets 56,645 54,070 56,645 54,070 54,313 Key ratios Gross claims ratio 70.3 75.9 72.9 73.6 72.2Net reinsurance ratio 1.0 -6.6 -0.9 -2.0 -0.4Claims ratio, net of reinsurance 71.3 69.3 72.0 71.6 71.8Gross expense ratio 16.4 15.5 16.5 15.7 16.4

Combined ratio 87.7 84.8 88.5 87.3 88.2

Gross expense ratio without adjustment b) 16.2 15.3 16.2 15.5 16.2Operating ratio 87.5 84.3 87.9 86.8 87.8

a) TheresultofTryg’sFinnishbranchandthemarinehullinsuranceispartofdiscontinuedbusiness.TheFinnishbranchwassoldtoIfP&CInsuranceCompanyLtd. (Finland) as at 1 May 2013 . The comparative figures related to the changes are restated accordingly. Result from discontinued and divested business appears from the financial statements.

b) The gross expense ratio without adjustment is calculated as the ratio of actual gross insurance operating costs to gross premium income.Other key ratios arecalculatedinaccordancewith‘’Recommendations&FinancialRatios2010’’issuedbytheDanishSocietyofFinancialAnalysts.Theadjustment,whichismade pursuant to the Danish Financial Supervisory Authority’s and the Danish Society of Financial Analysts’ definitions of expense ratio and combined ratio, involves the addition of a calculated expense (rent) in recpect of owner-occupied property based on a calculated market rent and the deduction of actual depreciation and operating costs on owner-occupied property.

Financial highlights


DKKm Q1-Q3 2012 Q1-Q3 2013 FY 2012 Notes General insurance Gross premiums written 16,069 15,933 20,128 Ceded insurance premiums -913 -873 -1,147 Change in premium provisions -716 -915 354 Change in reinsurers’ share of premium provisions 64 42 35

2 Premium income, net of reinsurance 14,504 14,187 19,370 3 Insurance technical interest, net of reinsurance 59 47 62 Claims paid -11,499 -10,386 -15,480 Reinsurance cover received 792 676 964 Change in claims provisions 389 -479 805 Change in the reinsurers’ share of claims provisions 113 366 131

4 Claims, net of reinsurance -10,205 -9,823 -13,580 Bonus and premium discounts -115 -251 -168 Acquisition costs -1,851 -1,700 -2,490 Administration expenses -625 -590 -805

Acquisition costs and administration expenses -2,476 -2,290 -3,295 Reinsurance commissions and profit participation from reinsurers 77 80 103

Insurance operating costs, net of reinsurance -2,399 -2,210 -3,192 1 Technical result 1,844 1,950 2,492 Investment activities Income from associates -1 0 6 Income from investment property 95 85 123 Interest income and dividends 921 780 1,196 5 Value adjustments 133 51 -16 Interest expenses -74 -77 -100 Administration expenses in connection with investment activities -74 -42 -99

Total investment return 1,000 797 1,110 3 Return on insurance provisions -420 -363 -525 Total Investment return after insurance technical interest 580 434 585 Other income 79 69 106 Other costs -124 -99 -166 Profit/loss before tax 2,379 2,354 3,017 Tax -593 -545 -837 Profit/loss on continuing business 1,786 1,809 2,180 6 Profit/loss on discontinued and divested business 18 -5 28 Profit/loss for the period 1,804 1,804 2,208 EarningspershareofDKK25–continuingbusiness 29.6 29.9 36.0 EarningspershareofDKK25 29.9 29.8 36.5 DilutedearningspershareofDKK25 29.7 29.7 36.4 EarningspershareofDKK25–discontinuedanddivestedbusiness 0.3 -0.1 0.5 DilutedearningspershareofDKK25–discontinuedanddivestedbusiness 0.3 -0.1 0.5

Income statement


DKKm Q1-Q3 2012 Q1-Q3 2013 FY 2012 Notes Profit/loss for the period 1,804 1,804 2,208

Other comprehensive income

Other comprehensive income which cannot subsequently be reclassified as profit or loss Revaluation of owner-occupied property 37 8 42 Tax on revaluation of owner-occupied property -10 0 -12 Actuarial gains/losses on defined-benefit pension plans -299 199 -62 Tax on actuarial gains/losses on defined-benefit pension plans 82 -56 16

-190 151 -16

Other comprehensive income which can subsequently be reclassified as profit or loss Exchange rate adjustments of foreign entities 190 -219 193 Hedging of currency risk in foreign entities -179 212 -184 Tax on hedging of currency risk in foreign entities 45 -53 46

56 -60 55

Total other comprehensive income -134 91 39

Comprehensive income 1,670 1,895 2,247

Statement of comprehensive income


DKKm 30.09.2012 30.09.2013 31.12.2012 Notes Assets Intangible assets 786 723 759

Operating equipment 124 122 138 Owner-occupied property 1,641 1,399 1,443 Assets under construction 10 0 11

Total property, plant and equipment 1,775 1,521 1,592

Investment property 2,203 2,054 2,081

Equity investments in associates 13 19 21

Total investments in associates 13 19 21

Equity investments 196 194 199 Unit trust units 3,214 3,795 3,261 Bonds 39,786 39,239 38,862 Deposits with credit institutions 1,323 806 949 Derivative financial instruments 871 235 547

Total other financial investment assets 45,390 44,269 43,818

Total investment assets 47,606 46,342 45,920

Reinsurers’ share of premium provisions 266 264 237 Reinsurers’ share of claims provisions 2,056 2,364 2,080

Total reinsurers’ share of provisions for insurance contracts 2,322 2,628 2,317

Receivables from policyholders 1,463 1,378 1,149

Total receivables in connection with direct insurance contracts 1,463 1,378 1,149 Receivables from insurance enterprises 258 202 227 Receivables from Group undertakings 0 0 1 Other receivables 187 105 612

Total receivables 1,908 1,685 1,989

Current tax assets 44 0 0 Deferred tax assets 38 0 0 Cash at bank and in hand 928 716 504 7 Assets held for sale 750 0 742 Other 0 1 0

Total other assets 1,760 717 1,246

Interest and rent receivable 353 354 369 Other prepayments and accrued income 135 100 121

Total prepayments and accrued income 488 454 490

Total assets 56,645 54,070 54,313

Statement of financial position


DKKm 30.09.2012 30.09.2013 31.12.2012 Note s Equity and liabilities Equity 10,365 10,854 10,979

Subordinated loan capital 1,595 1,844 1,597

Premium provisions 7,762 7,278 6,688 Claims provisions 27,425 26,586 27,242 Provisions for bonuses and premium discounts 387 561 425

Total provisions for insurance contracts 35,574 34,425 34,355

Pensions and similar liabilities 1,335 769 1,102 Deferred tax liability 1,520 1,438 1,143 Other provisions 91 31 98

Total provisions 2,946 2,238 2,343

Debt relating to direct insurance 376 423 415 Debt relating to reinsurance 266 214 256 Amounts owed to credit institutions 80 0 14 Debt relating to unsettled funds transactions and repos 3,218 2,300 1,470 Derivative financial instruments 54 15 66 Current tax liabilities 318 591 652 7 Liabilities associated with assets held for sale 750 0 742 Other debt 680 638 1,030

Total debt 5,742 4,181 4,645

Accruals and deferred income 423 528 394

Total equity and liabilities 56,645 54,070 54,313

8 Accounting policies


Reserve for exchange Share Revaluation rate Equalisation Other Retained Proposed DKKm capital reserves adjustment reserve reserves earnings dividend Total

Equity at 31 December 2011 1,533 42 92 59 1,154 5,727 400 9,007 Q1-Q3 2012

Profit/loss for the period -37 1,841 1,804Revaluation of owner-occupied property 37 37Exchange rate adjustment of foreign entities 190 190Hedging of foreign currency risk in foreign entities -179 -179Actuarial gains and losses on pension obligation -299 -299Tax on changes in equity -10 45 82 117

Total comprehensive income 0 27 56 0 -37 1,624 0 1,670Dividend paid -400 -400Dividend, treasury shares 6 6Purchase and sale of treasury shares 75 75Issue of share options and matching shares 7 7

Total changes in equity in Q1-Q3 2012 0 27 56 0 -37 1,712 -400 1,358

Equity at 30 September 2012 1,533 69 148 59 1,117 7,439 0 10,365

Equity at 31 December 2011 1,533 42 92 59 1,154 5,727 400 9,007 2012

Profit/loss for the year -40 654 1,594 2,208Change in equalisation provision 2 -2 0Revaluation of owner-occupied property 42 42Exchange rate adjustment of foreign entities 192 -1 2 193Hedging of foreign currency risk in foreign entities -184 -184Actuarial gains and losses on pension obligation -62 -62Tax on changes in equity -12 46 16 50

Total comprehensive income 0 30 54 2 -41 608 1,594 2,247Dividend paid -400 -400Dividend, treasury shares 6 6Purchase and sale of treasury shares 66 66Exercise of share options 44 44Issue of share options and matching shares 9 9

Total equity entries in 2012 0 30 54 2 -41 733 1,194 1,972

Equity at 31 December 2012 1,533 72 146 61 1,113 6,460 1,594 10,979

Statement of changes in equity


Reserve for exchange Share Revaluation rate Equalisation Other Retained Proposed DKKm capital reserves adjustment reserve reserves earnings dividend Total

Equity at 31 December 2012 1,533 72 146 61 1,113 6,460 1,594 10,979 Q1-Q3 2013

Profit/loss for the period -129 1,933 1,804Revaluation of owner-occupied property 8 8Exchange rate adjustment of foreign entities -219 -219Hedging of foreign currency risk in foreign entities 212 212Actuarial gains and losses on pension obligation 199 199Tax on changes in equity -53 -56 -109

Total comprehensive income 0 8 -60 0 -129 2,076 0 1,895Dividend paid -1,594 -1,594Dividend, treasury shares 15 15Purchase and sale of treasury shares -540 -540Exercise of share options 96 96Issue of share options and matching shares 3 3

Total changes in equity in Q1-Q3 2013 0 8 -60 0 -129 1,650 -1,594 -125

Equity at 30 September 2013 1,533 80 86 61 984 8,110 0 10,854


DKKm Q1-Q3 2012 Q1-Q3 2013 FY 2012 Cash from operating activities Premiums 15,849 15,389 20,200 Claims -11,248 -10,925 -15,105 Ceded business 63 -108 42 Costs -2,291 -2,153 -3,094 Change in other debt and other amounts receivable -436 68 -137

Cash flow from insurance activities 1,937 2,271 1,906

Interest income 1,073 814 1,340 Interest expenses -74 -77 -100 Dividend received 14 17 15 Taxes -137 -286 -425 Other income and costs -45 -30 -61

Cash from operating activities, continuing business 2,768 2,709 2,675

Cash from operating activities, discontinued and divested business 41 32 37

Total cash flow from operating activities 2,809 2,741 2,712

Investments Acquisition and refurbishment of real property -17 -14 -53 Sale of real property 101 0 278 Acquisition and sale of equity investments and unit trust units (net) -490 -488 -563 Purchase/sale of bonds (net) -1,211 15 -1,897 Deposits with credit institutions -189 91 163 Purchase/sale of operating equipment (net) -25 0 -54 Hedging of currency risk -179 212 -184

Investments, continuing business -2,010 -184 -2,310

Investments, discontinued and divested business -22 -584 -74

Total investments -2,032 -768 -2,384

Financing Exercise of share options/purchase of treasury shares (net) 82 -444 110 Subordinated loan capital 0 316 0 Dividend paid -400 -1,594 -400 Change in amounts owed to credit institutions 66 -14 3

Financing, continuing business -252 -1,736 -287 Financing, discontinued and divested business 0 0 58

Total financing -252 -1,736 -229

Change in cash and cash equivalents, net 525 237 99 Cashandcashequivalents–discontinuedanddivestedbusiness -11 0 -11 Exchange rate adjustment of cash and cash equivalents, beginning of year 12 -25 14

Change in cash and cash equivalents, gross 526 212 102

Cash and cash equivalents, beginning of year 402 504 402

Cash and cash equivalents, end of period 928 716 504

Cash flow statement


DKKm Private Commercial Corporate Sweden Other Group 1 Operating segments Q1-Q3 2013

Gross premium income 7,076 2,666 3,798 1,239 -12 14,767 Gross claims -4,865 -1,747 -3,326 -928 1 -10,865 Gross operating expenses -1,084 -522 -471 -213 0 -2,290

Profit/loss on ceded business -100 -35 416 -1 11 291 Insurance technical interest, net of reinsurance 22 7 10 8 0 47

Technical result 1,049 369 427 105 0 1,950 Total Investment return activities after insurance technical interest 434 Other income and costs -30

Profit/loss before tax 2,354

Tax -545

Profit/loss on continuing business 1,809

Profit/loss on discontinued and divested business -5 -5

Profit 1,804

Run-off gains/losses, net of reinsurance 238 146 341 -2 0 723

Intangible assets 481 242 723 Equity investments in associates 19 19 Reinsurers’ share of premium provisions 34 38 190 2 0 264 Reinsurers’ share of claims provisions 193 332 1,780 59 0 2,364 Other assets 50,700 50,700

Total assets 54,070

Premium provisions 3,003 1,476 1,877 922 0 7,278 Claims provisions 6,366 5,959 12,446 1,815 0 26,586 Provisions for bonuses and premium discounts 445 24 82 10 0 561 Other liabilities 8,791 8,791

Total liabilities 43,216

Notes


DKKm Private Commercial Corporate Sweden Other Group 1 Operating segments Q1-Q3 2012

Gross premium income 7,284 2,781 3,928 1,255 -10 15,238 Gross claims -5,367 -1,830 -2,894 -999 -20 -11,110 Gross operating expenses -1,141 -567 -486 -222 -60 -2,476

Profit/loss on ceded business 108 57 -28 -6 2 133 Insurance technical interest, net of reinsurance 23 7 9 20 0 59

Technical result 907 448 529 48 -88 1,844 Total Investment return activities after insurance technical interest 580 Other income and costs -45

Profit/loss before tax 2,379 Tax -593

Profit/loss on continuing business 1,786 Profit/loss on discontinued and divested business 18 18

Profit 1,804

Run-off gains/losses, net of reinsurance 286 183 337 -28 0 778

Intangible assets 513 273 786 Equity investments in associates 13 13 Reinsurers’ share of premium provisions 21 24 221 0 0 266 Reinsurers’ share of claims provisions 241 313 1,440 62 0 2,056 Assets held for sale 750 750 Other assets 52,774 52,774

Total assets 56,645

Premium provisions 3,194 1,575 1,951 1,042 0 7,762 Claims provisions 6,467 6,232 13,123 1,603 0 27,425 Provisions for bonuses and premium discounts 262 28 97 0 0 387 Liabilities associated with assets held for sale 750 750 Other liabilities 9,956 9,956


Notes


DKKm Private Commercial Corporate Sweden Other Group 1 Operating segments FY 2012

Gross premium income 9,733 3,687 5,258 1,654 -18 20,314

Gross claims -7,084 -2,372 -3,929 -1,267 -23 -14,675 Gross operating expenses -1,524 -748 -648 -306 -69 -3,295

Profit/loss on ceded business 81 32 -37 -3 13 86 Insurance technical interest, net of reinsurance 27 5 6 24 0 62

Technical result 1,233 604 650 102 -97 2,492 Total Investment return activities after insurance technical interest 585 Other income and costs -60

Profit/loss before tax 3,017 Tax -837

Profit/loss on continuing business 2,180

Profit/loss on discontinued and divested business 28 28

Profit 2,208

Run-off gains/losses, net of reinsurance 326 212 506 -29 0 1,015

Intangible assets 502 257 759 Equity investments in associates 21 21 Reinsurers’ share of premium provisions 1 0 236 0 0 237 Reinsurers’ share of claims provisions 249 319 1,448 64 0 2,080 Assets held for sale 742 742 Other assets 50,474 50,474

Total assets 54,313

Premium provisions 2,899 1,397 1,414 978 0 6,688 Claims provisions 6,479 6,203 13,011 1,549 0 27,242 Provisions for bonuses and premium discounts 291 32 101 0 1 425 Liabilities associated with assets held for sale 742 742 Other liabilities 8,237 8,237


Description of segments Amounts relating to eliminations, restructuring expenses and discontinued and divested business are included under ‘Other’. Other assets and

liabilities are managed at Group level and are therefore not allocated to the individual segments but are included under ‘Other’.

Costs are allocated according to specific keys, which are believed to provide the best estimate of assessed resource consumption. The operating business segments consist of Private, Commercial, Corporate and Sweden (Private and Commercial). Finland is included under ‘Discontinued and divested business’/’Other’. The comparative figures have been restated accordingly.

Notes


Notes

DKKm Q3 2012 Q3 2013 Q1-Q3 2012 Q1-Q3 2013 FY 2012

1 Geographical segments Danish general insurance a)

Gross premium income 2,475 2,365 7,454 7,170 9,910

Technical result 239 399 905 1,074 1,441 Run-off gains/losses, net of reinsurance 115 134 412 442 571

Key ratios Gross claims ratio 72.6 85.6 73.9 77.3 71.1 Net reinsurance ratio 2.4 -17.5 -1.1 -7.1 -0.2 Claims ratio, net of reinsurance 75.0 68.1 72.8 70.2 70.9 Gross expense ratio 14.9 15.2 15.1 14.9 14.5

Combined ratio 89.9 83.3 87.9 85.1 85.4

Number of full-time employees, end of period 2,259 2,081 2,259 2,081 2,187 Norwegian general insurance


Technical result 455 365 963 846 1,017 Run-off gains/losses, net of reinsurance 95 105 385 270 464

Key ratios Gross claims ratio 64.2 61.4 69.8 66.9 72.4 Net reinsurance ratio -0.8 4.6 -1.1 3.7 -1.0 Claims ratio, net of reinsurance 63.4 66.0 68.7 70.6 71.4 Gross expense ratio 15.3 15.5 16.2 15.7 16.8

Combined ratio 78.7 81.5 84.9 86.3 88.2

Number of full-time employees, end of period 1,305 1,209 1,305 1,209 1,282 Swedish general insurance

Gross premium income 619 592 1,646 1,675 2,183

Technical result 46 2 64 30 131 Run-off gains/losses, net of reinsurance -15 4 -19 11 -21

Key ratios Gross claims ratio 76.6 82.8 78.4 80.8 75.3 Net reinsurance ratio 2.1 2.0 1.3 0.7 1.5 Claims ratio, net of reinsurance 78.7 84.8 79.7 81.5 76.8 Gross expense ratio 15.0 14.9 17.9 17.3 18.6

Combined ratio 93.7 99.7 97.6 98.8 95.4

Number of full-time employees, end of period 433 467 433 467 444

a) Comprises Danish general insurance and Finnish guarantee insurance.


Notes

DKKm Q3 2012 Q3 2013 Q1-Q3 2012 Q1-Q3 2013 FY 2012

1 Geographical segments Other b)

Gross premium income -1 -4 -10 -12 -18

Technical result -88 0 -88 0 -97 Tryg


Technical result 652 766 1,844 1,950 2,492 Investment return activities 338 152 580 434 585 Other income and costs -14 -11 -45 -30 -60 Profit/loss before tax 976 907 2,379 2,354 3,017 Run-off gains/losses, net of reinsurance 195 243 778 723 1,015

Key ratios Gross claims ratio 70.3 75.9 72.9 73.6 72.2 Net reinsurance ratio 1.0 -6.6 -0.9 -2.0 -0.4 Claims ratio, net of reinsurance 71.3 69.3 72.0 71.6 71.8 Gross expense ratio 16.4 15.5 16.5 15.7 16.4

Combined ratio 87.7 84.8 88.5 87.3 88.2

Number of full-time employees, end of period, continuing business 3,997 3,757 3,997 3,757 3,913 Number of full-time employees, end of period, in discontinued and divested business 194 0 194 0 189

b) Amounts relating to eliminations and restructuring expenses are included under ‘Other’


DKKm Q1-Q3 2012 Q1-Q3 2013 FY 2012

2 Premium income, net of reinsurance Direct insurance 15,281 14,926 20,395 Indirect insurance 46 59 60

15,327 14,985 20,455 Unexpired risk provision 26 32 27

15,353 15,017 20,482 Ceded direct insurance -798 -808 -1,051 Ceded indirect insurance -51 -22 -61

14,504 14,187 19,370

3 Insurance technical interest, net of reinsurance Return on insurance provisions 420 363 525 Discounting transferred from claims provisions -361 -316 -463

59 47 62

4 Claims, net of reinsurance Claims -11,200 -11,424 -14,958 Run-off previous years, gross 90 559 283

-11,110 -10,865 -14,675 Reinsurance cover received 217 878 363 Run-off previous years, reinsurers’ share 688 164 732

-10,205 -9,823 -13,580

Notes


DKKm Q1-Q3 2012 Q1-Q3 2013 FY 2012

5 Value adjustments Value adjustments concerning financial assets or liabilities at fair value with value adjustment in the income statement: Equity investments 0 0 2 Unit trust units 270 367 378 Share derivatives 2 5 -2 Bonds 190 -256 202 Interest derivatives 211 -289 263 Other loans 0 -1 0

673 -174 843

Value adjustments concerning assets or liabilities that cannot be attributed to IAS 39: Investment property 68 0 82 Owner-occupied property -151 0 -350 Discounting -371 280 -475 Other statement of financial position items -86 -55 -116

-540 225 -859

133 51 -16

6 Profit/loss on discontinued and divested business Gross premium income 463 202 611 Gross claims -370 -151 -484 Total insurance operating costs -210 -54 -244

Profit/loss on gross business -117 -3 -117 Profit/loss on ceded business -3 0 -4 Insurance technical interest, net of reinsurance 3 1 4

Technical result -117 -2 -117 Total investment return after insurance technical interest 25 0 32 Other income and costs 112 0 113

Profit/loss before tax 20 -2 28

Tax -2 -3 0

Profit/loss on discontinued and divested business 18 -5 28

Run-off regarding discontinued Marine Hull insurance 4 10 1 Divested finnish branch 14 -15 27

The 6 November 2012 Tryg Forsikring a/s entered into an agreement on sale of the Finnish branch, which was responsible for the Group’s activities in Finland. The sale is concluded with effect from 1 May 2013, after which control of the activity in question is transferred to the buyer.

Notes


DKK m 30.09.2012 30.09.2013 31.12.2012

7 Assets held for sale and associated liabilities Intangible assets 112 0 112 Property, plant and equipment 2 0 2 Investment assets and cash and cash equivalents 571 0 603 Reinsurers’ share of premium provisions 0 0 0 Reinsurers’ share of claims provisions 7 0 7 Receivables 58 0 18

Assets held for sale 750 0 742

Premium provisions 146 0 125 Claims provisions 518 0 540 Other debt 86 0 77

Liabilities associated with assets held for sale 750 0 742

Net assets held for sale 0 0 0 In the balance sheets as of 30 September 2012 and 31 December 2012 assets and liabilities related to the sale of the Finnish branch are

classified as ‘Assets held for sale’ and ‘Liabilities related to assets held for sale’. The proceeds from the sale are equal to the carrying amount of the related assets and liabilities.

The profit is unchanged in relation to the assessment per 30.09.2012 The activity which comprised assets and liabilities held for sale and constituted the Group’s activities in Finland was definitively disposed

of on 1 May 2013. The sale can be specified as follows: 30.09.2012 30.09.2013 31.12.2012

Intangible assets 0 112 0 Property, plant and equipment 0 1 0 Investment assets, cash and cash equivalents 0 696 0 Reinsurers’ share of claims provisions 0 3 0 Receivables 0 48 0

Premium provisions 0 168 0 Claims provisions 0 565 0 Other debt 0 15 0

Bookvalue of net assets sold 0 112 0

Total consideration 0 112 0

Notes


DKKm

8 Accounting policies Tryg’s first to third quarter 2013 report is presented in accordance with IAS 34 Interim Financial Reporting and the financial reporting

requirements for Danish listed companies of the Danish Financial Business Act and OMX.

The application of IAS 34 means that the report is limited relative to the presentation of a full annual report and that the valuation principles are in accordance with International Financial Reporting Standards (IFRS).

From 1 January 2013 the Group implemented the following standards: • AmendmentstoIFRS7’FinancialInstruments:Disclosure–Offsettingofasetsandliabilities’ • AmendmentstoIAS12’DeferredTax–RecoveryofunderlyingAssets’ • IFRS13‘FairValueMeasurement’ • AmendmentstoIAS1‘PresentationofitemsofotherComprehensiveIncome’ • AmendmentstoIAS1‘AnnualImprovemnets2009-2011Cycle(comparativeinformation)’ • AmendmentstoIAS16‘AnnualImprovements2009-2011cycle(Servicingequipment)’ • IAS19(asrevisedin2011)‘EmployeeBenefits’ • IAS27(asrevisedin2011)‘SeparateFinancialStatements’ • IAS28(asrevisedin2011)‘InvestmentsinAssociatesandJointVentures’ • AmendmentstoIAS32‘AnnualImprovements2009-2011Cycle(taxeffectofequitydistribution)’ The implementation of the new standards has not significantly affected recognition and measurement in 2013. Apart from this, the accounting policies are unchanged from the annual report 2012. The annual report 2012 contains the full description of the accounting policies.

Changes in accounting estimates The calculation of insurance technical interest was changed with effect from Q2 2013. Insurance technical interest is subsequently

calculated based on the monthly average provision plus interest under the present yield curve for each individual group of risks taking into account the provisions’ expected run-off pattern. A co-weighted interest from the present yield curve was previously used for each individual group of risks.

The change does not affect the net profit for the year as it concerns a redistribution between the technical result and the investment return

netofinsurancetechnicalinterest.ThechangeisestimatedtohaveincreasedtheinsurancetechnicalresultbyasmuchasDKK12m, with the investment return being reduced by the same amount.

Change in the estimated tax percentage from 25% to 23 % in Q3 2013 is due to change in the expected tax free share gains in Norway

and the reduction in the tax percentage in Denmark in the coming years.

Notes

Quarterly outline


Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3DKKm 2011 2011 2012 2012 2012 2012 2013 2013 2013

Private

Gross premium income 2,385 2,373 2,401 2,405 2,478 2,449 2,384 2,363 2,329

Technical result 231 192 152 351 404 326 245 364 440

Key ratios Gross claims ratio 89.2 76.0 80.4 71.8 69.0 70.1 72.9 68.5 64.7Net reinsurance ratio -14.3 0.3 -2.3 -2.1 -0.1 1.1 1.8 0.8 1.7Claims ratio, net of reinsurance 74.9 76.3 78.1 69.7 68.9 71.2 74.7 69.3 66.4Gross expense ratio 16.1 16.3 16.0 16.0 15.0 15.6 15.3 15.6 15.1

Combined ratio 91.0 92.6 94.1 85.7 83.9 86.8 90.0 84.9 81.5

Combined ratio exclusive of run-off 94.3 94.4 98.4 90.1 87.0 88.4 93.5 89.0 84.0 Commercial

Gross premium income 946 916 920 930 931 906 908 899 859


Key ratios Gross claims ratio 96.4 64.2 78.2 62.6 56.8 59.8 67.7 73.1 55.3Net reinsurance ratio -24.9 2.1 -7.1 -1.4 2.3 2.8 2.1 -2.1 4.1Claims ratio, net of reinsurance 71.5 66.3 71.1 61.2 59.1 62.6 69.8 71.0 59.4Gross expense ratio 21.2 19.4 20.0 21.1 20.1 20.0 19.4 18.9 20.5

Combined ratio 92.7 85.7 91.1 82.3 79.2 82.6 89.2 89.9 79.9

Combined ratio exclusive of run-off 102.0 95.9 95.7 90.4 86.3 85.8 93.9 93.0 88.6 Corporate



Key ratios Gross claims ratio 85.8 90.0 78.9 64.0 78.2 77.8 68.9 82.7 111.8Net reinsurance ratio -9.5 -4.6 -2.2 1.8 2.5 0.7 7.6 -9.6 -31.3Claims ratio, net of reinsurance 76.3 85.4 76.7 65.8 80.7 78.5 76.5 73.1 80.5Gross expense ratio 12.3 13.1 12.6 12.7 11.9 12.2 13.1 11.8 12.3

Combined ratio 88.6 98.5 89.3 78.5 92.6 90.7 89.6 84.9 92.8

Combined ratio exclusive of run-off 98.5 112.9 96.7 92.1 97.3 103.4 97.8 95.5 100.9


Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3DKKm 2011 2011 2012 2012 2012 2012 2013 2013 2013

Sweden

Gross premium income 451 370 361 417 477 399 377 420 442

Technical result 17 -44 -28 28 48 54 23 28 54

Key ratios Gross claims ratio 86.3 88.1 87.5 77.7 75.3 67.2 75.6 76.7 72.6Net reinsurance ratio -2.9 0.5 0.6 -0.2 1.0 -0.8 -0.3 0.0 0.5Claims ratio, net of reinsurance 83.4 88.6 88.1 77.5 76.3 66.4 75.3 76.7 73.1Gross expense ratio 14.0 24.9 21.9 17.7 14.5 21.1 19.6 17.6 14.7

Combined ratio 97.4 113.5 110.0 95.2 90.8 87.5 94.9 94.3 87.8


Other a)

Gross premium income -5 -17 -2 -7 -1 -8 -1 -7 -4

Technical result 0 0 0 0 -88 -9 0 0 0

Tryg


Technical result 480 310 361 831 652 648 500 684 766Investment return -189 144 353 -111 338 5 269 13 152Profit/loss before tax 279 467 702 701 976 638 759 688 907Profit/loss 163 344 556 515 733 404 575 514 715

Key ratios Gross claims ratio 89.5 78.5 79.9 68.7 70.3 70.2 71.2 73.7 75.9Net reinsurance ratio -14.1 -0.9 -2.7 -1.0 1.0 0.9 3.1 -2.6 -6.6Claims ratio, net of reinsurance 75.4 77.6 77.2 67.7 71.3 71.1 74.3 71.1 69.3Gross expense ratio 16.1 16.9 16.6 16.5 16.4 16.3 16.0 15.6 15.5

Combined ratio 91.5 94.5 93.8 84.2 87.7 87.4 90.3 86.7 84.8


a) Amounts relating to eliminations and restructuring expenses are included under ‘Other’

A more detailed version of the presentation can be seen at www.tryg.com > investor > Downloads

http://tryg.com/en/investor/downloads/index.html

Further information

Contact details

Visit tryg.comand follow us attwitter.com/TrygIR

Lars MøllerInvestor Relations Director+45 22 66 66 [email protected]

Peter BrondtInvestor Relations Manager+45 22 75 89 [email protected]

Steffen Lundgren KristensenChief Communication Officer+45 41 86 28 [email protected]

Financial calendar

Annual report 2013 30 January 2014

Annual general meeting 3 April 2014

Interim report for Q1 10 April 2014

Interim report for Q2 and H1 10 July 2014

Interim report for Q1-Q3 10 October 2014

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